NBHC - Earnings call transcript Q3 2019 | National Bank Holdings Corporation

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Operator

Good morning, everyone, and welcome to the National Bank Holdings Corporation 2019 Third Quarter Earnings Call. My name is Mariama and I will be your conference operator for today.

At this time, all participants are in a listen-only mode.

We will conduct a question-and-answer session following the prepared remarks.

As a reminder, this conference is being recorded for replay purposes.

potential remind including this loans statements growth, strategic to contain call and like margin, deposits, statements, gross forward-looking regarding capital, would you non-interest conference that will loan taxes I and streams, expense. income the Company's differ could discussed those from today. materially results Actual which Company's and These forward-looking most with US Securities factors, recent Commission. to in more uncertainties and risks filings statements disclosed and detail Exchange are other subject are in the the and call Bank of or the date undertakes statements obligation Holdings These only no this Corporation speak as revise of these National to update statements.

to It is Mr. now the and my Corporation's and pleasure introduce Holdings National CEO, Chairman, President turn Bank over Laney. Tim call

Tim Laney

I Aldis Management Officer. you Newfield, solid joining and deposits record loan balance Thank you, Risk Holdings morning non-interest income. Birkans our fee and Mariama. strong earnings our Chief in to pleased of National for quarter Good the Chief bearing Financial with of and have on me, growth earnings Rick record Officer, third another report thank call. We're Bank quarter growth, XXXX strength

loan by at group a we of grew group. an solid Record from rate XX.X% was demand deposit balances non-interest banking specifically, an at annualized of annualized XX.X%. income our consumer fee while our More residential growing driven rate bearing contribution with

Aldis? believe XXXX. important to in setting are we ourselves we on focused operating up and efficiencies it's Finally, realize management note that very we expense to additional remain

Aldis Birkans

Thank you and good morning.

performance residential reporting business. quarter by loan deposit solid Tim a growth cost already are driven by earnings mortgage As of and record to our we pleased great another mentioned, very low be and

XX.X% record million on is $X.XX. of This million of an share quarter an quarterly net increase X.X% For the third of over we the quarter, quarter income [ph] XXXX. linked third and or of $X.X basis increase $XX.X a record and reported

drivers, release, many call as fronts, some of a for and this key in As busy sheet the out parts the and various earnings was of quarter will statement. I we balance reported I our cover us on income

growth, and this strong are originations with our increase loan In $XXX.X saw new terms the of pleased quarter Led trends the by organic X.X% were over last quarter we across XXXX year. quarter an the same of million, this we the commercial loan levels to loan be activity, diversified during quarter. increase Originations production XX.X% various asset and second continue over well classes. geographies

around The in regional markets global growth. economies despite remained and uncertainty the solid our growing, macro economic

market business, a generally and Our forward clients small maintain positive consumer middle outlook.

to our the opportunity portfolio However, given this loan we well. of quarter the portions to quarter and efforts uncertainty, the during took groom increased fourth expect continue as these

strategic balances combined activity expect a increased growth actions, this we in grown paydown an refinancing levels. achieve acquired to payoff loan quarter, have elevated On with guidance client and originated full of loan our and Our a resulted loan the XX.X% strong XXXX basis, year-to-date and year XX%.

quarter basis with bearing side represent the ago. deposits non-interest of improvement other on year X.X% balance grew a Average deposit now and sheet, pleased the deposits a cost our low a balances XX.X% On linked XX.X% deposits. relationship continue be growth the very of to non-interest with we from our annualized bearing of total

full mid-single digits. transaction we to the in annualized average transaction grew expect deliver for our total deposits X.X% average Our growth and on guidance deposit year

points deposit the on Our taken quarter lower actions our third prior we XX transaction a the fourth quarter, X quarter. rates Heading deposit decreased from to in interest accounts. into basis to cost low have further the basis point

with money billion are $X.X in have We we savings and to responding pricing interest other market, bearing average which accounts deposit adjustments. rapidly

the of drop actions. a costs deposit continued fourth transaction as in a these realize quarter result to expect We of

margin equivalent interest X.XX%. was net for quarter taxable the Fully

funds Fed entirely drop for driven points basis point rate point point with point Our decrease basis in Fed our X basis expectations target. in interest each is decrease of basis basis a This linked-quarter to of the XX X rate XX X cuts. by line cut two the

through at margin the assets will expected the year low around project Looking interest with interest a Fed October, at with $X.X in earning we be be the our should cut prior the [ph] of rate taxable follows end widely continue end and Consistent to impacted the fourth margin billion. XXXs. equivalent ahead, guidance, net if now to the

in second remains swiftly the that With regard loan address to we to moved one discussed acquisition, over loan our which We came overall with problem quarter's credit, the very Peoples call. shape. Bank during portfolio good the

our were this annualized a result, net quarter charge-offs points. As XX basis

this to remaining points very acquired was loan, expense basis million provision and $X.X low related included annualized to The year-to-date. at net charge-off the remained X related this quarter problem million portfolio the Excluding problem this one charge-offs loan. $X.X

this Bank of loan to the was sufficient cover rest Peoples the Just the recap, at the specific $X.X as well expense loan loan of than problem acquisition, time as to day million, more Peoples portfolio. one mark

of we our be million into continue earnings XX, $X.X still As had amortized the that time. market over purchase September will to remaining XXXX, of

We XX and see basis XX granular basis declined the improving ratio a fact, no XX, points loans on systemic non-accrual at quarter-over-quarter on issues and basis with in non-performing XXXX. year-over-year points to June loan across portfolio and our diversified from

net to originated are loan to cover we and at provision points. XX expecting of basis quarter, XX fourth annualized to X%, basis the normalize charge-offs For growth expense points

quarter $X.X non-interest higher of million, During million which quarter, record income realized the the $XX.X we second than third XXXX. was

million banking While results we in exceeded the which mortgage bank service guidance. charges our showed card quarter's this our solid income fees, $XX.X was and highlight in

benefit is operating markets. to purchase residential market continue the built business core in on from we local strong and mortgage Our

the last our during rates second XX% XX% quarter this the origination that just you compared represented in nice some pressures. quarter, which color, margin capitalized have quarter To the mortgage provides quarter the activity teams this low the activity, as to year. hedge on refinancing fueled XX% Additionally, refinancing a or XXXX same turn volume give the to of

home into We season. both we refinancing fourth the $XX be down, project the fourth XXXX non-interest half our million to project the buying total during holiday the and especially second slow to the range. million the quarter activity quarter, income to in ahead, for of the Looking $XX heading

Regarding decreased the million totaled $X.X million expenses, third $XX.X expense our quarter. and from quarter's prior non-interest

This non-interest quarter, some a was closed within we as sales on two work The and these from for sales time. OREO million property OREO had expense recorded in contra our expense. been gain totaled $X.X that

to guidance problem workout Our these guidance. previous projected are have our and exceeded we this asset cover to expenses very happy year's gains

occur consolidation banking of quarter in quarter we this four of XXXX. fourth announced Additionally, the the that centers will

effort, of back $XXX,XXX expect efficiencies. charge incurred within impairment the during through quarter, which part we year this we operating As a improved third to earn

have a impact XX we on centers to our and to digital or to total to any low-cost that leverage We expect. in clients banking do expect not consolidated us service conveniences our deposits. as Since invest continuously XXXX, of our grow operating either these closed material ability our allow improve we consolidations the look have to

performance. a a expense problem center increased expense result This gains, million. OREO the mortgage total line higher Excluding as the driven non-interest asset compensation was in banking increase $X.X workout million of the in increase residential $X.X by and consolidation quarter third the charge,

reflecting effective in our income. total quarter to we tax was For for XX%, higher million the $XX the the be expenses range. quarter, rate $XX to fourth taxable expect The the million

XXXX, in the we XX.X% XX.X% tax quarter the fourth guided For the range. expect previously rate of to effective to be

Tim, that concludes comments. my

Tim Laney

Aldis. Thank you,

previously quarter To clear, are assets We of related record be and earnings common expense tangible delivered the another returns we on proud equity. pleased suspect of reliance to the not share tangible regularities, investigated. activity having with with quarter that with with continues connection discussed during increasing on taken are be financial the loan. to not you this despite that statements acquired We'll audited if in we've uncovered relationship, the

leverage Moving Tier capital with relates we capital, on, XX.X% as it finished a the quarter ratio. to X

$XX.XX tangible XX.X% pleased to value we're Our the value book period. months, over same per XX was tangible quarterly while the our increased have increased dividend XX.X% share over having past book and

On the Mariama? for that point, up open we'll call questions.

Operator

Davidson. first Jeff Thank Instructions] comes with from DA you. Your [Operator Rulis question

open. Your is line

Jeff Rulis

Aldis. and morning, Good Tim

Following to of like charge-offs? like to sort maybe -- loans of credit is going there book? non-accrual is one-off one that suggests, a get through processing the churn in credit to from Peoples body discussed. of some and and and I'm stability here you're these I Or approach side, obviously see guess, an sounds the up that you language true type kind just non-accrual try get more to on the more more level identified should the trying aggressive this to we the

Rick Newfield

is Jeff, Rick. morning. Sure. good This

your answer question. me Let

has and I So maintained acquisition a will our yes, a this Peoples sector came subcontractor this exposure. the loan related share over to with in which that bank and the loan is minimal exposures is a

our In over total had or fact, other results acquired working subcontractor type also through to success problem any our we've better through are of said, than loan with marks. I'll contractor portfolio. initial out loans point just loans in and of Peoples as Aldis credit X%

don't put I loan And systemic negative finally, portfolio, issues our really in the book. see any on overall or to perspective trends

In criticized XX non-performing steadily the quarter decreasing and been all assets and fact, during our over we've non-accrual loans, months. loans, last classified loans decreased third the

Aldis Birkans

one-off while to And is on -- Jeff, the is, thing to we this portfolio jump -- purchase rest as that accreting the that mark the mark one in. and mark and Aldis. I'll portfolio $X.X sorry, our that the much This Again, we've credit million in on had disappointing better point is have earnings. we of that Tim's performed Rick's

Jeff Rulis

there? is you. kind million one remaining $XX through the here, Got there from movement more are that anything of lumpier is what's -- non-accrual $XX million the snake granular credits pretty in the sizable? chunkier left, this some of That Or

Rick Newfield

this Actually, it's us. point granular This Jeff, very Rick is no. at to again.

is in types, a nice no across there loan again, concentration. no, sort of So, distribution different of nothing particular size

Jeff Rulis

kind the on net thoughts any outstripping It Thanks. expectations. then QX guess, workout. asset the about on thoughts the expectations -- the for out like for I Got on those you. of expectations XXXX gain And exceeded of OREO problem rolling on two or How you the sounds items?

Tim Laney

strong provide We're OREO, delivering and trend recoveries continue less that point if that terms we Great, a strong ready Right. question. I look working you and return content a we're to we we economic our of to record and not but expect as can. anything in great managing at on than guidance, think through at nothing XXXX acquire track where it's

Jeff Rulis

Got you kind ahead the robust. of and that guidance CECL you. deployment with next Tim, related Aldis, of on initial as, you've or thoughts well as year? I there kind know any of capital if levels alternatives gauge Any pretty got And of you closed could way don't

Tim Laney

the Aldis, to you take do CECL want first?

Aldis Birkans

first. CECL the take I'll Yes.

as loans had the of behind shy with nothing disclosed the It's set that feverishly some allowance to $X accounting September along to just that that XXXX acquired XX, million fourth than CECL assume quarter's still, be specific. other purchase scenes rest We we We've fair that, But it. that the do do the were earnings approximately require $X on of aside haven't that for any to could under am of call been $XXX impact. million million. of outlook. looking that, I will accounted with working

Tim Laney

Aldis may that a kick would seeing represent me here, surprise... but we're not anything Jeff,

Jeff Rulis

No, I think…

Tim Laney

I I but quarter, know you want to wait fourth until think...

Aldis Birkans

it very, by having and models longer our you allowance think loans maybe that asset out -- coming seeing are a reporting look in to less you'd bigger very a consumer consistent I start or Yes, has the banks, more. little C&I life to mortgage needed terms bit some what of banks other classes, is a are if

not we're anything surprising. So, seeing

Tim Laney

Yes.

I robust, short-term strong from C&I having loan book. we'd benefit think a here

Aldis Birkans

Yes.

Tim Laney

that on us. And of on the basis. capital, focus increase The to semi-annual the I it importance a answer optionality on in continued typically robust a having a bit for then and a does capital as base create again, around your earlier dividend to question relates belief M&A strong that our of give optionality

So, to now, that leave Jeff. it I'm right at going

Jeff Rulis

And been it of but your is part that aggressive, buybacks, not that used, on that's a specifically? tool, but has optionality, thoughts any

Tim Laney

a had would target buying very very short actually that immediate in there many course, back not that our the was earn the on at of opportunity. back prices shares early now, change we of opportunistically with right so unless low I some markets as of radical Yes, we history mean, an

Jeff Rulis

from it Thanks. That's Great. me.

Tim Laney

Jeff. Thank Hey. you,

Operator

Your Stephens, question McGuire comes from Gordon next with Inc.

is line open. Your

Gordon McGuire

expense morning. million total XQ that on core? Aldis, the $XX clarify was Good it to expenses. whether a you or just Maybe can million for was $XX level start

Aldis Birkans

-- been any be At that this property not total. third OREO realized It's point, expecting in sales we're quarter talking been those. the have -- two about would we've

quarter one hit For just by we're way, why related in not it for happened the us. to

expense total I'm at point. just a So, this guidance. giving

Gordon McGuire

it. you release, the way closures top the what what's is saw there And opportunities up next you can when is? mind efficiency opportunity you Or about Got then, guys but talk mentioned the branch size any year. efficiency of I in of kind opportunities? four

Tim Laney

to continue to centers, of between that the using balance, right us. the appropriate monitor of our of that sense. digital we way Look, of use options it's made clients, they're consolidating where We've striking mortar track levels activity record our important brick the and banking balance a is right finding alternatives, centers had and banking

some In fact, situations activity be expected that selling made continue and in levels. some it's at where other sense should to

we business. moving small we with from consume-oriented the typical do that's to serve powerful targeted cases business where locations banking and think center, also away the bankers either in of We're many very identifying markets kind in business our

really for it's some We've been and yielded this results nice testing doing us. around

move. So, we serving of -- make on then as we're that does more of centers and efficiencies excuse do itself big those as that some clients targeting me, for business more create and affluent It us well. very with other moves in

consolidation centers have, then and I'll So, digital, others with a call, for considered leveraging be consumer there that activity mix transactional. is something to clients have that more as what, some transitioning -- relationships much more than that centers us robust business clients might of

about can to terms go we So, we're to Gordon, we it drive to taking optimistic, revenue, expense of where as while continuing pretty look both do down XXXX. in

Gordon McGuire

Okay.

expense to this stemming potentially So the base? would just provide this the growth? is the Or opportunity lower

Aldis Birkans

yet ready but of and this directionally, guidance, but on that, you're will efficiency we drive -- think XXXX not some Yes, I execute provide speed to the of right. we're which and

Gordon McGuire

going? far How there, build-out? then, pretty contributing meaning it. they're that's and expansion? the kind what just you at Got you're as And inning -- on like any feel Utah update the of as Whether meaningfully

Tim Laney

kind what of inning? say you Did

Gordon McGuire

Inning.

Tim Laney

residential there continue just going started, but business only stronger. strong we're The Yes, a get to is right, I clearly, would and really It's say, to middle-market an -- a as I competitors, too my very It's getting it's talk market. small what team market. see. don't look, up don't to like we banking. -- want to much attract we thriving again focus well is it's goodness, as and other because I a but I attractive just it want it

Aldis Birkans

performance. still is starting your contribute mode. to to We're we're still expansion answer to investing, it already the And question, in

to the contribution, already loan the So, expense but the the growth, income deposit say the market. is on so still than there originations fee contribution larger is coming from that

Gordon McGuire

right, step you. aside. I'll All thank

Tim Laney

Thank you, Gordon.

Operator

with Your Piper Race next from comes question Jaffray. Nathan

Your line is open.

Bob Shone

Nate. Hey. on It's you are guys Shone Bob for How doing?

Tim Laney

All right. Good morning.

Bob Shone

Good wanted in maybe you're talk now? can doing markets in markets specific you maybe others are for seeing right over turn I you to growth strength best the which to XXXX? in and loan or fourth if morning. quarter And projecting about

Tim Laney

All right.

national fact a than from on the averages So, virtually we the better core loan markets that every standpoint metric. are deposit benefit one on both growth every of our and operating growth virtually

all say, in and So, work our our continues capture very markets tide that lift hard those would that's fair to boats a share. to teams I

risk, you managing like great the doing a stand Clearly, markets geography, it's about well also out, a call should of job managing but to out the while of range think our specialty that some of a the I our related are when doing that groups front market operate within risk within quite our businesses. even Colorado,

call. actually across of at this and pretty our front Aldis you as tell we're at contribution would the optimistic, I remain said So, of seeing markets all point solid the

Bob Shone

right. All

Tim Laney

would would you add? add, Rick? What you Anything

Rick Newfield

terms estate diversified and exposures overall and on we markets. very of Tim, you've see what strong contributing mean, is industry maintaining type described again real hit to continue you I commercial think across in low it. very I

Tim Laney

structure rates the commercial all our at and estate we're real debt with in X refinance we I our or below with will commercial We longer-term to as clients, feel like of low a this, add remain helping balances While and find sense still rate natural fair estate seen capital, longer-term, them just the of Tier market alluded to perfectly to our Aldis or those low world. the into XXX% advisors amount have makes the refinancing debt that into trusted real opportunities that. fine

At we're stress on Aldis bank. and based out also of touched the just total drives portfolio you I semi-annual the certain not we on same at is amount comfortable of stress on year and that the time, think a certain as relationships I to exposure that testing conduct the latest move proactively know of looking each testing moving we describe that that with loan activity what think pruning about the it

been So, about results our stress talk and, to of that's the third that's take natural a testing. want you and into year moment may ebb the We're Rick, a flow now. latest of and occurring just some

Rick Newfield

Tim. briefly. touch Sure, it I'll on

on couple we're not one third required stress be very think a find I've our a do in we and and this internal really of I takes a testing, using we shared these while this before size, we with to year conduct of that testing times twice asset conservative bottoms-up. to and teammates our do a calls, look party hard one but

doing individual looking sort -- just some quantitative of methodology. hundreds We're loan we're kind So, files. of of a at not

just your exit gives opportunities to insight fine. loans us specific into it point, are Tim, So, to performing that

actually year-over-year, quite under actions improvement those and is stress in of economic rates in what recession, scenarios as we're the But very the all to to take sort the a great able loss any overall Tim, we on those ranging which or encouraging. seen point, than at your we've experienced look be to we would that of scenarios from way stress severe worse base, current of top

at our and more with our the testing loan our on look, markets good a averages than portfolio virtually our your the in and cautious We're obviously question to somewhat production, third-party about and of all are internal of as more national all on we metric better continues testing feel fortunate contribution to strong performing of of the answer as We're that talk book. every economic downturn. markets. least well So, terms support

Bob Shone

color. more with paydowns that awesome about just majority you certain opportunity pruning the taking the from That's due from up of and talked Or And structure to was could portfolio? the a of it competition? relationships. you the review I Would came one loan more, payouts say, follow evaluate to if radar

Tim Laney

Yes.

structure financers is of even our the us. to not competition, perm competition think mean, us the On for from five I financing longer-term -- years. don't radar I that's is long-term

so, I it And think as of don't competition.

I would that certainly of that add? had would commercial impact estate say in natural what terms its the transition. Rick, real in space, you

Rick Newfield

market, think balanced clients, of prune. and I certainly, reflect view Tim, that taking necessarily within issues where we but it's or estate, No, of of see very advantage to to some aggressive and opportunity be could doesn't your a those point, there is natural real we're

that more vulnerable be doing portfolio it's client focused so diversified, is that also not on single We're on. and we're like to by that maybe, sector, our client cyclically a because tends

Tim Laney

you want three last exposure. I an to conducted an to mean about been may years, speak Right, talk at activity or example we're two ag of the on example which our where but has over as most this

Rick Newfield

downstream need capitalized of with long-term with and and way pressure and that crop, on diversify over more to and portfolio not got out we clients management team a a that portfolio. ag Yes, not and other diversified in specialized which that example, we've three We this segment issues ago years also underwriting work resulted that's better no only a our into ag approach, the with ag right and probably but is your view really point great row and that more recent livestock has reasonable phenomena. one started Tim, producers, within to

over fact, and total remained prudent ongoing real just plus, the certainly an time $XX,XXX think but out In less be process. we've some selective as I than example, year one estate, last that that's charge-offs, is I think, pointed you in for would in

Tim Laney

we then So, would a maybe the that Rick would be, payoffs your kind it's of question or balance activity view the between as answer described. refinancing, natural pruning has and what to real short been

Bob Shone

great color, That's Thanks. Awesome. guys.

Rick Newfield

thank Hey, you.

Operator

Your next McGratty with question Chris from comes KBW.

line Your is open.

Tim Laney

Good morning, Chris.

Kelly Motta

is Good on this Motta Chris today. actually morning. for Kelly Hi,

Tim Laney

Kelly. you, Thank

Kelly Motta

second, just well taking of that? Maybe an provide for hoping reserve my the staying as credit could Thanks size update the question. for was on on you as I level the energy on one book

Rick Newfield

This Kelly. Sure, Rick. is

originated there. down of be working quarter a roughly four mean, the loan energy couple portfolio been over years. We've that at a over clear, To So, comments in $XX ended haven't loans. time. I energy million we at new we

from fact, down XX% it's year-to-date, In XX/XX/XXXX. nearly

book we're down see the managed of performance, we've the that very to not clients it's within I the significantly of well. terms quarters. over new Expect the years over that us exposure In have that next that we and several continue mean, stable. performing further trend last originating down number since are to

Tim Laney

or? Any specific reserve commentary that on

Rick Newfield

really, not Tim. No,

Tim Laney

I there's are mean, nothing Ratings all, unusual there?

Rick Newfield

No. had All stable. for have that small one We time. some non-accrual very loan we've do

quite to of finally and but portfolio We the stable. the not news expect is workout, really any that's rest

Kelly Motta

I And that your how deposit question us a your guys in to perform now remarks, help about mentioned deposit think maybe believe, should base transaction to the the trend expect just you outperformed figure the Great. given I on lower way way how beta pulp that then, you on is hoping cutting? to cost out was deposit up. Aldis, deposits, continue could you prepared Fed a

Aldis Birkans

I if I June you and tell it don't the say, first July, but cut to symmetrical in we've can should I way have with we going down, starting it's Yes, taken been or was be through hard September, proactive. a but look up, in way know that very rate on the

it we was reported spot point average basis quarter, deposit a the on basis on clients. understand of with September, they client basis, touch been is the every We've exception for there been cost We've in I as touch you the points. rate can tell the XX transaction with that being and environment to single XX if extent basis end in pricings at that changing the

seeing heading the this another into in if that's rate before, basis cutting again, actions. So we'll X fourth and pickup quarter to Fed further point take run already continues we're

Tim Laney

that, of The bearing spot, just huge, to quarter point on basis grow and We accounts, the trends, about at clients. accounts huge a the point. success the XX thing Kelly, as mid-sized XX we business today story That's basis core feel business good with operating our us. is particularly the for end non-interest continue small

Aldis Birkans

And time I'll up add one to book linked has points quarter that's for a more been and -- run basis. for basis the just drifting in thing deposits. its off on to that cost That's on time will locked obviously and looked went you XX time nowhere It continue if higher and bit in third little but to XXXX. basis start in quarter, extent higher this and the is way to the coming normalize of -- nature that just near a that expected repricing. still XX It's slightly the drift quarter saw of book points down deposits we then the

Tim Laney

of off. period already were And down we -- had This -- rates aggressively lower a up I the rates be that rates. CD we is again, while burning there, priced were clear our where lag mean, to gone already not previous just have

that so, and work as temporary one -- watching it's So, the we would through view it pipeline expect. as we're

Kelly Motta

color. guys. That's you, Thank great

Tim Laney

you. Thank

Operator

Tim with Sandler Partners. next O'Neill O'Brien question Your and from comes

Your open. line is

Tim O'Brien

Good morning, guys.

Tim Laney

Hi, Tim.

Tim O'Brien

questions. and odds of ends Couple

or were any to NII First, affected perhaps -- interest either the on the tied reversals that one-time prepay there items and charge-off on this benefit quarter? NII, any

Aldis Birkans

Nothing material, Tim.

Tim O'Brien

subcontractor. Is it book-of-business about total the that X% Peoples? bit of that over loans. loans Okay, from being come most of -- a did segment And little -- great. portfolio most or just Those of you talked then,

Rick Newfield

had total this Good and hi. Rick. a only is No, Tim, it's at National. -- handful a Peoples we morning, handful certainly have

Tim O'Brien

combination? a it's So

Rick Newfield

Right.

Tim O'Brien

Kelly's quarter? obviously operating is? this then, tied the just didn't being to book was little $XX to energy something million $XX in utilized is originate Is sequentially there new or And regard to that you follow upturn on was you that the Okay. Is balances that because a and with any haven't that loans to -- like quarterly what million. line question, an in

Rick Newfield

some had drawdowns We of previous right. had lines actually We this some those exactly on in quarter. that's Tim, quarter. the same paydowns

downs, down. and ups some again trending So, overall but

Tim O'Brien

one has your -- years, like lending that regard been to with real that about been Tim pretty then, through trying -- get market And estate loans sub into of question regard that to the put commercial fits on have you all rate strategy commercial the and with real how real conditions guys how and conduits -- clear you and last but do owner-occupied estate? X% a you're commercial estate, fixed stuff relationship when and XX-year for chasing view to overall

-- like you giving want how a term that or or the those little How do Tim. loan keep extending Just balance making that? on relationship value and -- that and to clients, that? serving commercial do term do to philosophy, you whole on there? bit What's your your Is -- balance with your these I clients, guess, loans? relationship What's make you there bringing in a thoughts

Tim Laney

We as market to going and long-term access is for move work the best make low cost of advisors for can that view going we move. with financing, clients the our opportunity and then trusted in we're direction they them to cycle to an our in the to there saying support balance a within it we're be that client longer term if

the respects, earning heart status. of the adviser again, as operating business accounts, We, core define relationship trusted the in that having many and those depository then,

limits So, turn And policy to got what's that Rick help but achieve out would find I that's goals we're important. price on happen, we'll of on any to them that. that inclined if our Rick, our make to to term clients their you're if with work you've ask, not or to stretch thoughts going to other

Rick Newfield

based long-term it's to of and to for win-win going best right the said, I've again, what's best exactly and answer that word with or think earning Tim, as kind you chase. reacted if the trust I financing support No, ultimately, on then that's view the and a the And And client of the bank. a is certainly we're for quality elsewhere, client. maintaining relationship that

is every creating I a Tim, you and tool banker at this the they're we at level is in powerful know this, relationship. the know we've about every client returns looking use And from banker talked but past our

if rabbit their down negatively quickly contribution direct frankly, they chasing term you of and or to is that And actually for their impacted. be profitability hole going proxy price, start see

So, it's that's and reinforced pretty I the at through organization the the banker way all level up clear. think

Tim O'Brien

answering my Thanks guys. questions, for

Operator

Thank questions have for call turn time. at we to no the remarks. you. showing I now And back I Laney closing further will am his Mr. this

Tim Laney

take Thank great line's come busy. Have Mariama. any -- later. know everyone simply say we'll I calls they day. a joining for on you I'll and you, say I'll certainly the thank follow-up should

Operator

this concludes today's And conference call.

to ID would If hours XXXX and call, Xth, approximately the beginning telephone Thank or of XXX-XXX-XXXX like available a The online available day. great of be an through the November the two will referencing have website to XXX-XXX-XXXX the will dialing be on run release and at this Investor also you company's this will Relations on you of much earnings page. listen by replay XXXXXXX. and call conference it and replay very

You may now disconnect.

National Bank (NBHC) 23 Oct 192019 Q3 Earnings call transcript